I had the same issue today after upgrading to WordPress 3.5 and twenty twelve theme. I was using a custom menu where the drop down menu was working perfectly fine. But after updating it did not work any more. Google search brought me here, and after reading the discussion I took another careful look at what is happening.
For my case at least, it turned out that Menu->Theme Location->Primary Menu setting was reset after the update. I selected my custom menu for that one, and now it’s working fine again. This worked for me, but it appears that your case is different than mine though.
P.S. This is my first post on the forum and I had to register just for this reply ??
